During recent interaction of Mr PiyushGoyal on ‘International Customs Day’, the acting Finance Minister expressed that every Indian must pay tax as the era of high taxes and misuse of public money is over. Appealing to the business community to pay taxes honestly and do business ethically, he said that every rupee collected is put to good use, to put a roof over someone’s head, to bring digital connectivity and electricity to rural areas, ensure better future for the youth and also to ensure the basic dignity for women in our country.
The Economic Survey 2017-18, puts the number of income tax payers at 5.9 crore people or 4.5% of total population. Depicting as per percentage of population does give an inflated number of tax payers, considering that the population also includes many groups which are not required to pay income tax; like children, students, those with income below the exemption limit, or those earning income from agriculture but still 4.5% is astonishing. It is easy to evade taxes in an economy such as India’s, where cash has traditionally been the preferred mode of payment. With no paper trail, self-employed doctors, lawyers, business establishments etc. can under-report income. The failed demonetization effort was more of a tax-collection initiative to get people to disclose unreported wealth and large amounts of cash stashed away to be deposited in bank accounts.
The entire North Eastern Region (NER) has been given ‘Special Status’ to ensure overall economic development in the state. The ‘Special Status’ ensures that the State’s tribal inhabitants are exempted from Income Tax. Still, we do pay a small share of tax every time we buy essentials; a portion of the amount of which goes to the government in a form of indirect tax. The recently introduced Goods & Services Tax (GST) also works on the same principle albeit with a centralised working structure.
An average Naga is ready to struggle in ones quest to become an entrepreneur or to venture in business undertakings. But there is always a dilemma owing to the multiple tax regimes of the various Groups. Illegal taxation/extortion, as a practice, has been going on for the past four decades, somewhat prominent in the late 80s and reached menacing levels in the 90s. Now with requirements ever increasing, citizens are paying a heavy price.
The yearly financial loss to the State exchequer can also be gauged in the process.
Our complacency to the various forms of extortions has adversely impacted the economy of the state. The exorbitant taxes levied on goods and services vehicle and on the business community leaves business houses with no option but to recover their loss from the common citizens. Hence, such artificial factors are causing rates of commodities to increase more than usual. While the State Government remains innate to the state of affairs it is encouraging that organizations/mindful citizens are voicing concerns against illegal tax collection. Not much headway has been made but resistance has caused the earlier practice of shamelessly having collecting booth alongside police check gates to give way. With time, I am sanguine, other novel ways of collection will give way too.
Long have Nagas played the role of foster parents to the various outfits; we need to encourage introducing a robust Income Tax model within Nagaland by taking a stand against all forms of taxation, instead. Introduction of Income Tax will not only relief us of excess reliance on the Centre for funding of all infrastructural projects, but make us beneficiaries of sustainable economic development. End to illegal tax collection and introducing Income Tax is the honest way and rest assured the surest approach to shape Nagaland’s future.
Khumlamo Patton
Akuk VIllage
